An oil platform in the North Sea. Forecasts for Scotland’s revenue from oil and gas have dropped sharply, as international oil prices have declined.
Photograph: Danny Lawson/PA

To observe the joy unconfined that greets each fresh tumble in oil prices is to be present at the birth of a new parlour game. Let’s call it Banana Republic, in which the contestants vie with each other to predict the economy of which country Scotland’s would most have resembled if she had gained her independence. Amid braying and snorting and shouts of “Central African Republic” and “Malawi” the winner would be the chap who could name the most colourful-sounding poor nation that existed in his imagination. And then someone would say: “Would the last person to leave the country please turn out the light. Oscar Wilde said that.”

As BP announced last week that it was to lay off hundreds of workers in its North Sea fields owing to the continued downturn in oil prices the usual suspects went into meltdown. There were two competing reactions: sympathy and concern for the families of those made redundant by their multibillion global super company and sheer delight at the prospect of giving the Nationalists a right good kicking. By the end of the week, those espousing the latter sentiment in Scotland had won easily. Many Scottish Labour figures, all of whom ought to have known better, were in the latter camp and that is why their party won’t have enough MSPs to run a coconut shy after the Holyrood elections.

Of course, there is some capital to be gained in the theatre of party politics owing to some ill-judged oil revenue predictions in the SNP’s white paper on Scottish independence. In that document, an unlovely and unnecessarily grandiloquent testament, the SNP predicted that in 2016-17 oil revenues would be somewhere in the region of £6.8bn to £7.9bn. In fact, at current prices, revenues will be a mere fraction of that. As such, according to some, the economy of an independent Scotland would have suffered defenestration; key public services would have been imperilled and the country would have been looking for handouts from Greece. Well, it might have been if Scotland’s economy rested solely on oil for its health and vigour.

Thankfully, it does not. Even without oil, Scotland’s GDP per head is less than 1% lower than the rest of the UK’s. Scotland is simply fortunate that it is one of only a favoured few countries that possess oil wealth, which has, at various points over the last 40-odd years, been, by turn, gargantuan, merely massive or disappointingly plentiful, as it is now. What is more, in its volatile history you can no more accurately predict the price of a barrel of oil than divine how many clean gold medals will be won at an Olympic Games.

This is how Alistair Darling described oil in 2008: “The trouble with oil is that it’s a tremendously volatile diminishing asset.” In the same year, the Telegraph predicted that North Sea oil would last for another century. A year later, the newspaper had revised that figure down a tad. “Collapsing oil revenue will turn the whole UK into a banana republic,” it warned.

Last week, it was announced that the UK’s economy grew by 0.4% in the third quarter of 2015 from the previous three months. In the same period, Scotland’s economy grew by 0.1%, despite job losses in the North Sea and the accompanying strain on firms that service the oil sector. There are two ways of looking at this: the UK economy as a whole enjoyed a modest increase and Scotland enjoyed a slightly more modest increase, thus exhibiting a welcome resilience in difficult conditions. Or the Scottish economy was four times worse off than the rest of the UK’s. You can guess which outlets chose the latter view.

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In the febrile political atmosphere that has persisted since the independence referendum there has been a tendency by either side to take up entrenched positions on policy areas to a far greater degree than the pre-referendum norm. In such feverish conditions has the oil debate been conducted.

Thus, if the referendum had not taken place then much more would have been made of the concomitant economic benefits derived from the oil crisis. The price of a litre of petrol which, in the middle of last year was about £1.45, has been cut to around £1.05, a reduction of around 27%. This has stimulated other parts of the economy in terms of increased consumer optimism and a hike in profits, leading to healthier recruitment levels and higher wages. In the rush to land punches on the SNP for its pre-referendum oil receipt estimates, much of this has been ignored.

Less than a year ago, the FT reported that the Fraser of Allander Institute, the country’s premier economic think-tank, was expressing faith in the robust character of Scotland’s economy. “The oil industry is very, very important and in many ways the jewel in the Scottish economy,” said Brian Ashcroft, the institute’s chief economist, “but the Scottish economy is much bigger than the oil industry and there are lots of areas that will benefit from lower oil prices.” Scotland and the less affluent northern outreaches of England will always be secondary players in the top-down nature of the south’s interpretation and exploitation of the UK economy. Not only is the wealth and income gap distorted in favour of the affluent south-east, so too is the economic narrative. In this, a country where 1% of citizens take 90% of its £100m profit is deemed to be richer than one which makes only £10m, but distributes it equally. But it is far, far poorer.

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Scotland’s citizens are far from economically illiterate and those who are poorest know more than anyone else what a proper economic challenge looks like. What scares the bejesus out of the monetarists is that for 16 months now these people appear to be putting their faith in something higher than personal financial gain.

We can only wonder what Scotland would have looked like if successive Labour and Tory governments hadn’t concealed the 1974 McCrone report, which stated that North Sea oil receipts would have made an independent Scotland the second richest country in Europe. Instead, Margaret Thatcher used it to pay off a viable coal industry and now her acolytes ridicule us for being naive about what remains.